The positive development in operational business at Heidelberger Druckmaschinen AG (Heidelberg) continued in the second quarter of financial year 2010/2011 (July 1 to September 30, 2010). Based on preliminary calculations, incoming orders were up on the previous year's level (EUR 534 million) at EUR 651 million, whereof some EUR 39 million is accounted for by exchange rate movements. Although this figure is lower than the previous quarter, which was boosted by special items such as exchange rate effects and trade shows, incoming orders are in line with the company's own planning. Preliminary sales climbed significantly against the previous year (EUR 499 million) to EUR 633 million, including exchange rate effects of some EUR 38 million, and were thus also up on the previous quarter. Thanks to the successful restructuring measures, the preliminary operating result excluding special items is within the range of EUR -5 million and EUR -10 million - and thus has clearly improved compared to the previous year's quarter (EUR -65 million) and the previous quarter (EUR -35 million).

"The preliminary figures show that our organizational and strategic realignment is taking effect. Due to our improved structures we furthermore profit from the cyclical upturn as well as from the recovery in the industrialized countries. Thus, we confirm the forecast for financial year 2010/11," stated Heidelberg CEO Bernhard Schreier. "In the medium term, expected growth within the strategically important areas packaging printing, services, and consumables as well as continuing favorable developments in the emerging countries will additionally support Heidelberg's success."

Earnings from special items totaled EUR 7 million in the second quarter. The preliminary financial result in the second quarter is around EUR -50 million (previous year: EUR -27 million). Financing costs and non-recurring expenditures for the repayment of loans from the proceeds of the capital increase were among the items having a negative impact on this result.

Despite the outflow of funds associated with restructuring measures, Heidelberg achieved a slightly positive free cash flow in the second quarter which was in line with expectations.

For the current financial year 2010/2011, Heidelberg continues to expect a moderate growth in sales. The operating result will benefit from increasing profit contributions and the savings achieved so far. Assuming stable economic developments, Heidelberg is still striving for a break-even operating result in the current financial year. The forecast of economic developments reflected in the company's financial year planning takes into account the respective product mix prevalent in the single markets. As expected, however, financing costs and non-recurring expenditures for the repayment of loans from the proceeds of the capital increase will burden the financial result. The repayment of financial liabilities made possible by the successful capital increase will improve this situation in the remaining months of the current financial year. Heidelberg continues to expect a significant net loss for the current financial year.

 "With the successful capital increase we were able to considerably reduce our financial debt, and to strengthen the financial stability of the Heidelberg Group in the long term. Additionally, due to the enhanced financing structure we have implemented a solid basis for sustainable growth enabling us to break even quickest possible," said Dirk Kaliebe, CFO of the company.

The final figures for the second quarter of financial year 2010/2011 are due to be published on November 10, 2010.